COSATU Media Monitor, 7 February 2012

Impala Platinum and the National Union of Mineworkers (NUM) will not ask the CCMA to resolve a dispute at the mine's Rustenburg operations, despite a request by Labour Minister Mildred Oliphant on Monday.

“We are not going to take that proposal.... The NUM and Implats agree,” said NUM national spokesman Lesiba Seshoka.

“Impala has basically agreed to take back the workers... so there is no dispute,” he said. Implats spokesman Bob Gilmour agreed.

He wrote in response to an e-mailed question on whether Implats would approach the Commission for Conciliation, Medication and Arbitration (CCMA) as suggested by Oliphant: “Not at this stage as we are commencing the process of rehiring.”

Last week, Implats fired 13,000 miners who went on an illegal strike starting on January 30.

On January 27, 4200 workers were fired for embarking on an illegal strike at the mine.

Implats said it was in the process of rehiring those workers who had reapplied for their positions.

Earlier on Monday, Oliphant called on the parties to approach the CCMA.

“While there may be real problems raised by the industrial action embarked upon by employees of Implats a few weeks ago, problems of this kind are best dealt with through conflict resolution measures between management, employees, and the trade unions concerned,” she said in a statement.

She said it was a serious cause for concern that 17,200 employees had been dismissed.

The CCMA offered its services on Friday in terms of section 150 of the Labour Relations Act, the labour department said.

Section 150 allows the CCMA to intervene in disputes of public interest.

“The department understands that the CCMA's offer of assistance has already been accepted by the National Union of Mineworkers and has further urged all parties to resolve their differences through constructive dialogue as soon as possible,” Oliphant said.

Seshoka said this was not the case.

The mine is losing around 3000 ounces of production a day due to the strike.

Implats said the problems at the mine started on January 12 when rock drill operators (RDOs) downed tools over salary concerns and refused to involve the recognised union, the NUM, in addressing their issues.

According to Business Day on Friday, the drillers wanted to be represented by the Association of Mining and Construction Union (Amcu) instead of the NUM.

Seshoka said Amcu had encouraged workers to strike so that they would be fired.

“This is just a strategy to make sure all (NUM) members are fired... when the company rehires... it is an opportunity for them (Amcu) 3/8 to recruit,” he said.

He said Amcu had fewer than 100 members at Implats.

Implats said last week it had told the workers that raising their issues through work stoppage was unacceptable and that this had to be done through recognised processes and structures.

“Any engagement with delegates outside the NUM would be a breach of the recognition agreement,” Implats said.

The company denied allowing Amcu to convene meetings and address workers on the mine, as was alleged by the NUM last week.

“Save for giving the RDOs an opportunity to voice their grievances and responding or advising as previously mentioned, Impala did not negotiate with any delegation from the RDOs.

“The company has in fact encouraged the NUM to meet with its members.”

Last week, Seshoka said Implats had increased miners' salaries by 18 percent, but had excluded rock drillers and other categories, which triggered the illegal strike.

Impala denied that this was unilaterally done.

“A valid and binding wage agreement is in place between Impala and the recognised union, the NUM, as of October 2011. It needs to be pointed out that no increases were unilaterally awarded to any category of employees.”

“The only increases were salary adjustments for the miners, which were implemented in full consultation with the NUM,” Implats said. – Sapa

1.2 Locals being readmitted to mine after strike

AllAfrica.com, 6 February 2012

Mozambican mineworkers are being readmitted to the Impala platinum mine at Rustenburg, in South Africa's North-West province, after taking part in a strike last month that a local court ruled was illegal.

According to a Monday press release from the Mozambican Labour Ministry, the strike broke out on 19 January. The mine employs 26,000 workers, including 1,860 Mozambicans.

17,200 workers, including some of the Mozambicans, took part in the strike. When the court declared the strike illegal, the mining company terminated the work contracts of the strikers.

The immediate cause of the strike was a wage increase for certain categories of miners, but which was regarded as discriminatory because it excluded the Rock Drill Operators. There were 5,000 workers in this group, 100 of whom are Mozambicans.

They demanded a net monthly wage of 9,000 rands (about 1,180 US dollars), rather than the 5,000 rands agreed under the collective bargaining agreement of June 2011.

This was a wildcat strike, in that it was not called by the South African National Union of Mineworkers (NUM), and this was why the Rustenberg court ruled it illegal.

The management gave the Rock Drill Operators an ultimatum - with they returned to work within seven days or they would be sacked The deadline ran out, the operators did not return, and the management issued them with letters of dismissal, rescinding their contracts.

The immediate effect of this was to spread the strike, and all 17,200 underground workers at the mine came out in solidarity with the Rock Drill Operators.

There are allegations that many workers joined the strike because of intimidation. The company has seen its chance to sack those it regards as trouble makers, and is obliging all strikers who want their jobs back to re-apply. They are forced to go through a screening process to determine the level of involvement of each of them in the strike.

The Labour Ministry Delegation in South Africa has intervened on behalf of the Mozambicans, and the release claimed that their readmission is now under way.

However, the strike is continuing, with the management saying it will only negotiate with the NUM, and the strikers saying that they area represented, not by the NUM, but by their own elected committee.

The NUM says the strike has been stirred up by a competing union, the Association of Mining and Construction Union (AMCU) in order to poach its members.

Nonetheless, the NUM's regional secretary, Sidwell Dokolwana, said the union has asked the Commission for Mediation, Conciliation and Arbitration to help settle the dispute.

1.3 Hundreds of clothing jobs on line at Trubok

Nompumelelo Magwaza, Business Report, 7 February 2012

At least another 400 jobs in the clothing and textile sector are on the line as Trubok plans to lay off workers. This brings the possible job losses in the industry to 1 900 this month alone. The Southern African Clothing and Textile Workers’ Union (Sactwu) confirmed yesterday that the union had been given notice by Trubok that the company might embark on retrenchments.

The union’s general secretary, Andre Kriel, said: “The formal notice advises that 400 workers may be affected by the proposed restructuring.” It is believed that Trubok, which operates factories in Cape Town, Durban, Newcastle and Port Elizabeth, also plans to merge its factories in the near future. Last week Seardel proposed to retrench at least 1 500 employees as the clothing and textile manufacturer faced shrinking margins. Kriel said although the formal facilitation to the action would begin later this week, Sactwu would oppose both of the proposals in order to protect jobs. Trubok could not be reached for comment yesterday.

1.4 Firing of over 300 Gautrain bus drivers is deemed illegal

Shain Germaner, Star, 7 February 2012

More than 300 Gautrain bus drivers have been fired after an illegal strike crippled the bus service, leaving more than 10 000 commuters stranded.

Bus drivers said complaints of 11-hour shifts and a lack of transportation to and from work had been ignored by their employers, Mega Express.

Now, the lawyer representing the drivers, Kevin van Huyssteen, has dubbed the mass firing wrongful termination and said he would be fighting to help his clients regain their jobs.

According to Van Huyssteen, the dismissal of 320 drivers is a breach of the Basic Conditions of Employment Act, something that set the strike off in the first place.

Van Huyssteen said that legally the drivers had no obligation to work before 6am and after 6pm, and it was the company’s responsibility to provide transport home for drivers “sometimes knocking off after 10.30pm”.

He cited a lack of pay as another major breach of the act.

“These guys are being paid for 7.5 hours a day on 11-hour shifts,” he said.

The case has been set down for arbitration on February 22.

Vusi Ngobeni, one of 320 drivers sent a termination notice, said many of the workers at the Midrand bus depot lived in Kempton Park and a lack of public transport occasionally prevented them from getting to work.

“We have to use lift clubs, or hitchhike, or use expensive (metered cabs) to get to work. On our salary we cannot afford this,” said Ngobeni.

Long hours with no bathroom or lunch breaks was the drivers’ major concern.

“Some of us get up at 2am for the start of the day (4am) and work until 2.30pm without food.

“What they (Mega Express) must know is that they have pushed us to the limit. They were firing people wrongly,” he said.

The drivers, who spent yesterday blockading the Midrand Gautrain bus depot, have spent months negotiating with their employers, eventually leading to an illegal strike last month.

After a four-day strike, the drivers were ordered by an interdict on January 13 to return to work.

According to Bombela, the company responsible for managing the Gautrain and speaking on behalf of Mega Express, disciplinary hearings after the first illegal strike had led to the current impasse.

Several drivers were dismissed, sparking further anger and a counter-interdict designed to halt the disciplinary hearings.

The application was dismissed on February 1.

Drivers abandoned their routes again, and disciplinary action continued.

On Friday, the drivers were given an ultimatum to return to work by 3pm or give reasons why they should not be dismissed.

Numerous requests by the drivers for an extension to the deadline were denied, and Van Huyssteen’s office received the termination notices.

Bombela said yesterday morning: “Bearing in mind that this is the fourth illegal work stoppage in the past six months and that it is in defiance of a court interdict compelling the drivers to return to work, the management of Mega Express came to the view that the contents of the submission did not provide justifiable grounds to halt the disciplinary procedures.

“As a consequence, the process to dismiss those drivers involved in the illegal strike has now begun.”

The company is trying to operate on a skeleton staff, but there was no word yesterday about when the buses would be on the road again.

The drivers were initially represented by the SA Transport and Allied Workers Union, but later withdrew from the union and found private representation.

1.5 Gautrain bus driver Vusi Ngobeni’s daily schedule

Star, 7 February 2012

2am: Vusi Ngobeni wakes up at his home in Soshanguve to get ready for his 4am shift at the Pretoria depot.

2.45am-3am: He uses unreliable transport to get to the depot, either hitchhiking, using metered cabs or hoping a colleague with his own car can pick him up.

4am: Ngobeni arrives at the Pretoria depot. He does the compulsory safety checks on the bus he will drive.

4.15am: He makes his way to his assigned route’s half-way point within 45 minutes of arriving at the depot.

4.45am: Ngobeni starts his route to pick up commuters.

10-11am: During the off-peak hours, Ngobeni might get five to 10 minutes for a bathroom break.

2pm: Ngobeni returns to the depot. It takes about half an hour to park the bus and report before he can clock out.

2.30pm: He catches a regular taxi to go home.

1.6 Bus driver strike weakens Gautrain

Business Report, 7 February 2012

There had been at least a 10 percent decline in the number of commuters using the Gautrain because of an illegal strike by Gautrain feeder bus drivers, the Bombela Concession company said yesterday. Between 30 000 and 34 000 people use the Gautrain every week.

Gautrain bus drivers went on an illegal strike on Wednesday last week and were given until Friday to make representations on why they should not be dismissed. Spokesman Errol Braithwaite said management had not found grounds to halt disciplinary procedures as this was the fourth illegal strike in six months. – Sapa

1.7 Textile industry ‘optimistic’ despite looming job cuts

Bekezela Phakathi, Business Day, 7 February 2012

Despite Seardel ’s proposed move to retrench about 1500 staff, the future of the clothing industry remained one of optimism and sustainable growth, Apparel Manufacturers of SA director Johann Baard said yesterday.

The sector was dealt a blow yesterday by news that Seardel was looking at the possibility of laying off some of its workers due to constant downward pressure on margins, which has seen the clothing and textile maker post substantial and unsustainable losses.

The proposed retrenchments come at a time when the clothing sector is beginning to stabilise after a decade during which at least 50000 jobs have been lost.

The proposals could also hamper the government’s drive to breathe new life into the sector, which continues to struggle to compete with cheap Chinese imports.

Mr Baard said yesterday that while the proposed retrenchments were "very regrettable", he remained confident about the prospects of the clothing sector at large. "Isolated retrenchments such as these appear to be atypical when viewed against overall developments within the clothing sector," he said.

"It must be stressed that close to 600 jobs have already been created under the new entry wage dispensation. Among our membership, nearly double that is envisaged over the next three to six months."

In October, textile industry employers concluded a landmark deal with the Southern African Clothing and Textile Workers Union (Sactwu) to offer 30% lower wages to new employees, in an innovative bid to boost employment. The government late last year also announced measures intended to boost job creation in the sector.

Mr Baard also said the government’s support measures, such as the Production Incentive Scheme, had made significant contributions towards the stabilisation of the sector over the past 18 months.

Seardel CE Stuart Queen said yesterday the proposed retrenchments would affect all levels of employees from senior management down. "However, these changes are subject to the formal consultation process in terms of section 189 of the Labour Relations Act and we are hopeful that through this process we may be able to minimise the number of people affected."

He said without the government’s assistance, the industry would have been in a far more precarious situation. "Although efforts are being made to curb illegal imports, this remains the single (biggest) threat to the local manufacturers and requires more focused attention."

Sactwu general secretary Andre Kriel said yesterday that the union’s priority at this stage was to stop the proposed job cuts.

Mr Kriel said while the industry was much better off than previously with the introduction of support measures such as the Production Incentive Scheme, the retrenchments, if carried out, would put a damper on the industry.

1.8 Pinnacle Point appeared solvent, inquiry hears

Glynnis Underhill, Mail & Guardian, 7 February 2012

The director of Cape Point Vineyards, Sybrand Van Der Spuy, told the insolvency inquiry into JSE-listed luxury property group Pinnacle Point in Cape Town on Monday that he had believed the group was solvent when he became a minority shareholder.

However, his relationship with some directors soured when he later came to believe he had been misled, he explained.

While it is hoped the inquiry will unravel the mystery of why R250-million of misappropriated clothing workers' pension fund money was sunk into this risky investment, the chances of any recovery from Pinnacle Point Holdings were "zero," according to Van Der Spuy.

Van Der Spuy said he had been drawn to the venture by Pinnacle Point director, David Mostert, as they played golf together.

"He said to me: here is a very good investment," said Van Der Spuy.

The other Pinnacle Point director Van Der Spuy discussed his investment with was Mervyn Key, who was implicated in fraud charges following Tollgate's liquidation in 1992. An attorney, Key was found not guilty of all charges of fraud and theft involving R28.6-million relating to Tollgate.

Van Der Spuy told the inquiry that Key is now living in Australia, and has assets there.

A qualified chartered accountant, Van Der Spuy explained to the inquiry how he had examined the share proposal and financial records before he invested his money.

Seemed solvent
On the surface it had looked like a "very solvent company," he said.

Van Der Spuy said he had been told he could buy the shares from Pinnacle Point Holdings in Pinnacle Point Group, but he had not rushed in.

When he took a trip in Mostert's helicopter to one of Pinnacle Point's developments, he looked through the share proposal again. Van Der Spuy said he later asked for and examined the financial records of Pinnacle Point Holdings.

Satisfied with what he saw, he invested in the company and acquired his first tranche of shares in February 2010. But he later started delving into what he believed were questionable business practices at the group.

Cape Point Vineyards, which was part of the application for the liquidation of the group, has called for an investigation in the affairs of all the directors and their subsequent prosecution if any wrongdoing is discovered. The wine estate owns 1% of Pinnacle.

Pinnacle Point was placed in final liquidation on November last year after six of its subsidiaries were liquidated that month but the order came while the group owed creditors hundreds of millions of rands.

Getting to the bottom of it
So far, seven people, including former directors and shareholders, have been subpoenaed to appear in the first round of the inquiry. The hearings are being held in the plush offices of top law firm Edward Nathan Sonnenbergs (ENS) in the city and the inquiry will try to get to the bottom of the group's transactions, including those that saw Pinnacle Point's subsidiaries being lent more than R200-million by banks.

The company was involved in developing golf estates and luxury resorts in the country, and it had ambitious plans for developments in Nigeria and the Seychelles, the inquiry heard.

The inquiry will further explore how the company's shares suffered from a share trading debacle involving single stock futures and banks. As a result, Absa is suing Nedbank for R773-million for losses it said it suffered after taking an exposure to Pinnacle Point.

Keeping a close watch on the proceedings on Monday was Southern African Clothing and Textile Workers Union (Sactwu) general secretary, Andre Kriel, who is hoping to recover money for workers.

Unwitting clothing workers became the majority shareholders in the group when millions of rands from their pension funds were invested in this venture without their knowledge.

Kriel has said the union is particularly interested in what role the banks had played in the demise of the Pinnacle Point Group.

2. ANC

2.1 Sebabi: Mathale’s govt must collapse

IOL, 6 February 2012

Limpopo premier Cassel Mathale's government must collapse or the ANC risks losing the 2014 local government election, Cosatu in Limpopo said on Monday.

“You see, the political danger of the current situation is that if we are not careful people can deliberately, when they are said to be leading the ANC, deliberately fail the ANC in 2014 because they don’t need the ANC anymore,” said provincial secretary Dan Sebabi.

“They need tenders more than the ANC.”

He was addressing about 200 protesting members of the National Education Health and Allied Workers' Union outside the premier's office.

Sebabi praised the workers for demonstrating against Mathale's administration and for demanding their unpaid bonuses.

He said the government had exhausted its budget and failed to pay bonuses because it had focused on tender projects.

The protesters demanded the resignation of Mathale and his director general Rachel Modiba-Molepo.

The national government placed five Limpopo departments under administration last year.

Sebabi said other departments would be mobilised to join the protest if workers' grievances were not resolved.

“We must push them out of office because they have lost their capacity to listen. We must make this place our own Tahir Square (a reference to protests in Egypt ). We must sleep here, eat here and wash here until Mathale is gone.”- Sapa

2.2 Cosatu bemoans Limpopo ANC's money woes

News24, 6 February 2012

The Limpopo ANC's alleged failure to pay its workers' salaries was shocking, Cosatu said on Monday.

"The matter should be treated as both serious and urgent," said Congress of SA Trade Unions provincial secretary Dan Sebabi.

"We expect the ANC to lead a programme for transformation of society and to fight for the improvement of working and living conditions of our people as a whole," he said.

Sebabi called on the African National Congress headquarters to intervene.

Last week, ANC Limpopo spokesperson Makonde Mathiva refused to comment on claims by employees at Franse Mohlala House - the ANC's provincial headquarters in Polokwane - that they had not been paid their January salaries.

Mathiva said it was inappropriate for him to discuss the matter as it was of a confidential nature.

The workers are usually paid on the 25th of each month.

They told the Sowetan newspaper that the ANC had sent them from pillar to post whenever they enquired about their salaries.

They also claimed they were not paid bonuses in December, as had been the norm in previous years.

ANC spokesperson Keith Khoza said all matters relating to salaries were dealt with by the party's treasurer Mathews Phosa.

Phosa could not be immediately reached for comment.

Last month, provincial secretary Soviet Lekganyane admitted that the party had financial problems.

It had asked traditional leaders for money ahead of its provincial centenary celebrations in Sekhukhune and had been given 15 cows.

Lekganyane reportedly said the financial problems within the party were the result of a number of events held last year, including the December provincial elective conference at which premier Cassel Mathale held on to his post as ANC chairperson. – SAPA

2.3 Protest over 'DG's R500000 furniture'

Alex Matlala & Chester Makana, Sowetan, 7 February 2012

New furniture worth R500000 for the Limpopo government has raised more dust in the bankrupt province.

Yesterday, employees in the office of Premier Cassel Mathale affiliated to the National Education, Health and Allied Workers' Union expressed their opposition to the purchase by picketing outside the offices at lunch time.

The workers want the director-general (D-G), Rachel Molepo-Modipa, to resign.

"We are very serious about our call for Molepo-Modipa to resign," Nehawu branch secretary Norman Mavhunga said.

Mavhunga said they were also protesting against intimidation, victimisation and the escalating corruption in Mathale's office without any action being taken.

The union's provincial chairman, Mike Shingange, said they would be left with no option but to call for other branches to embark on a fully fledged strike should their demands not be met within a week.

Cosatu provincial secretary Dan Sebabi said: "Mathale's administration must collapse now because we know that he and his friends are deliberately failing the ANC because they are interested in tenders."

Limpopo government spokesman Tebatso Mabitsela said the new furniture was not bought for Molepo-Modipa but to convert an office in the premier's office into a boardroom.

"The D-G is still using the office fitted with furniture which was bought in 2003," he said.

2.4 Malema verdict boosts ANCYL, say analysts

Daily News, 6 February 2012

Prospects for a united ANC Youth League in KwaZulu-Natal are greatly improved, say political commentators and young members of the party.

This is after the ANC’s national disciplinary committee of appeals upheld a guilty verdict against Julius Malema and other top ANC Youth League officials for sowing divisions in the ruling party and bringing it into disrepute.

Malema will remain the ANC Youth leader – at least until he appeals against a five-year suspension imposed on him by the ANC’s national disciplinary committee in November.

Also facing Malema is a two-year suspended sentence from a previous incident in 2010 – also for bringing the party into disrepute.

Political analyst Zakhele Ndlovu, a lecturer at the University of KwaZulu-Natal, said that the appeals committee’s decision was not a surprise.

“The fact that the youth from his home town of Seshego were celebrating this decision does not bode well for him going forward. They are beginning to see what he is all about,” he said.

The party’s youth league in KZN had also had its fair share of problems, he said, which could now be over because of Malema’s suspension. The party would have a united front.

The league’s provincial executive committee was disbanded last year after being found guilty of undermining Malema’s national executive committee.

In October, Malema and the national executive committee appointed an 18-member task team to run the league in the province.

“The ANCYL in KZN is now solidly behind Jacob Zuma and him serving a second term as president,” Ndlovu said.

“This is not because of the way the president has run the country thus far, but because the president is from our province. At this point, I think that people are wanting to ensure that their political career is safe.”

Siboniso Duma, a former provincial deputy secretary of the youth league, praised the ANC’s decision.

“Malema is not important. The ANC is older and wiser. This is going to assist in uniting the organisation,” he said.

He added that the party was simply implementing its constitution.

“Whoever goes against this constitution should be punished.”

However, Vukani Ndlovu, the convener of the provincial task team, said the youth league would exhaust avenues of appeal.

“We cannot be happy but at the same time we all fall under the ANC and still support our party,” he said.

“We are still going to the lekgotla of the ANCYL next weekend.”

Trade union federation Cosatu said it respected the decision to suspend Malema.

“We will continue to respect the internal processes, and any decision of discipline is supported,” said Cosatu’s KZN provincial secretary, Zet Luzipo.

“Leaders must continue to respect their own structure, and these decisions cannot be made on the basis of being happy. Not everyone will be happy with every decision that is made, but we must still respect those decisions.”

Speaking at a Cosatu provincial council meeting in Durban yesterday, Luzipo said Cosatu had full confidence in the collective national leadership of the tripartite alliance, Cosatu, the SACP and the ANC.

“We believe that they will be able to carry us to their respective congresses, and thereafter people will be entitled to identify any of the leaders they want to take forward,” he said.

“When people have preferred individuals, they lose objectivity in their analysis of leadership performance.”

2.5 ANC backs development plan

Bernard Sathekge, The New Age, 7 February 2012

The national development plan (NDP) received a shot in the arm after the ANC expressed its full support for the ambitious 2030 vision.

In Monday's press briefing, ANC secretary-general Gwede Mantashe, said the ANC NEC meeting discussed and approved the development plan to ensure the country had a clear plan and vision that would address the country’s social and economic challenges.

Mantashe stressed the NDP was adopted as a framework for national planning and the infrastructure draft plan was tabled and debated. He said if the recommendations received strong support, the country would prosper.

The plan was unveiled by the National Planning Commission head Trevor Manuel in November last year, with a promise to steer South Africa onto a new and bold socio-economic development path.

Monday's announcement came amid indications that some quarters within the ANC’s broad church were campaigning to discredit the plan. The National Union of Metalworkers SA (Numsa) criticised the draft, saying that its framework deviated from the ANC’s 2007 Polokwane national conference resolutions.

Numsa was of the opinion that both the diagnostic report and NDP deliberately ignored the basic systematic and structural driver of the development crisis, which was “white monopoly capitalism”. There were fears that intense politicking within the ANC might derail the plan.

The plan was presented to President Jacob Zuma as a packet of recommendations to be scrutinised and endorsed by the cabinet.

Its nine areas of focus include jobs, education, health, socio-economic infrastructure, spatial planning, economic structure, public service, corruption and social cohesion.

The document says unemployment will have to fall from 27% today to 14% by 2020 and to 6% by 2030. To reach this target, the country must create an additional 11 million jobs. The draft speaks of the need for GDP per capita to increase from about R50 000 per person in 2010 to R110 000 per person by 2030.

Recently, the plan was used as a marketing tool to woo potential investors to South Africa and the continent during the annual World Economic Forum, which ended last week.

Business Unity SA urged both the government and private sector to ensure that the target set out in the NDP and the national growth path became a reality in 2012.

3. Mining report

3.1 ANC wants state, labour to pool mine resources

Carol Paton & Sam Mkokeli, Business Day, 7 February 2012

The African National Congress (ANC)-commissioned study of state intervention in the mining sector — expected to be made public this month — proposes sweeping changes to the taxation of the industry.

It also proposes the creation of a sovereign wealth fund financed by a 50% tax on mining "super profits", the merger of six existing government departments, and the combination of all state and trade union pension fund holdings in mining companies into a single special-purpose vehicle.

As expected, the report totally dismisses calls for the nationalisation of mines — which will come as a huge relief to the industry and to local and foreign investment markets.

The report says total nationalisation of the industry would cost R1-trillion and nationalisation without compensation, as proposed by the ANC Youth League, "would require a constitutional change and would result in the near collapse of foreign investment as well as widespread litigation by foreign investors domiciled in states that we have trade and investment (protection) agreements with".

The report, due to be considered by the ruling party at a policy conference at the end of June, calls for the creation of a State Minerals Company by transferring capacity and holdings from the state.

It proposes that the company should initially be run by the Industrial Development Corporation until legislation is in place to establish it as a freestanding, state-owned company.

It should then fall under the control of a super-ministry, the Ministry of the Economy, encompassing the current departments of trade and industry; mineral resources; energy; public enterprises; economic development; and science and technology.

The authors of the report warn that "a prerequisite for success is a dramatic enhancement of the quality of our science and maths education".

"In SA, in many instances," the report says, "a combination of state and union (pension) holdings already represents a significant holding in many mining companies, but the union holding is generally managed by private-sector fund managers, giving little scope for direct influence by unions.

"The unions should pool their mineral holdings with the state in an SPV (special purpose vehicle) that would then have a major influence on mining companies.

"For strategic minerals, where majority state control might be necessary, this holding could be increased to a controlling holding, but this will require compensation at market value."

Frans Baleni, National Union of Mineworkers general secretary, said last night he had not yet seen the report, but the matter of their members’ pensions was "a very sensitive one. We would need to consult broadly."

The report also seeks the amendment of the Mining Charter, to increase black empowerment equity holdings to 30%.

It suggests the rights to "known" mineral deposits should be sold by auction and prospecting rights should be granted only over areas where there are no known "biddable" minerals assets.

Where only "partly known" assets exist, these should be reserved for the State Minerals Company to develop and bring to auction.

It says the Department of Mineral Resources should be given a "maximum" period of six months to produce a classification of all SA’s unconcessioned mineral assets into "known" resources, where potential is "unknown" and "partly known" — where data is insufficient to allow for auction.

The authors, who studied mineral regimes in the world’s most important mining economies, suggest a capital gains tax of 50% should be imposed on groups "flipping" prospecting rights, and they propose stiff tax increases on super profits.

A resource rent tax, they argue, should be imposed on "all mining". The report says: "It will trigger after a normal return on investments has been achieved, thus not impacting on marginal or low-grade deposits."

A "normal" return should be defined as "our treasury long bond rate plus 7%".

The long bond rate is about 15% presently, implying that they would tax returns of more than 22% at 50%. "A resource rent tax of 50% would yield about R40bn per annum at current prices," the report says. "The resource rent tax proceeds should ideally be kept in an offshore sovereign wealth fund to ameliorate the strengthening of our currency during commodity booms.

"We need to standardise the mineral fiscal regime by replacing the current gold mining formula tax with corporate income tax plus the resource rent tax, applicable to all minerals."

A 50% tax would be highly contentious, and it seems likely the authors deliberately have pitched it high in the expectation it will be wrestled down in negotiation with the industry, as was a similar bid in Australia last year.

SA has a regulatory framework that is unpopular with investors and the country has slipped down the rankings in terms of attractiveness to those wishing to prospect for and mine minerals.

A tax that is more than double that of Australia’s new tax of 22,5% on only coal and iron ore — and which the authors suggest should apply to all minerals — is sure to deepen the gloom of foreign investors.

At the Mining Indaba in Cape Town yesterday, Minister in the Presidency Trevor Manuel said SA was moving to a "sensible" mining tax regime.

"It’s critical that sensible tax and royalty regimes be put in place to extract the rates from the sector so we can invest the proceeds in the country’s broader development," Mr Manuel said.

He said the royalty system could be improved on and whether the rates were correct was "open for debate".

The report suggests cutting current royalty rates imposed on mining companies from 4% to 1% of turnover and that the royalties collected should be ring-fenced to fund a Minerals Commission (which would grant licences), the rehabilitation of mines and investment in communities close to mining operations.

It also proposes increasing the tax burden on miners registered in tax havens (it cites Xstrata, which is based in Switzerland) from 10% to 30% and sharply criticises the carbon tax proposed by the Treasury.

The carbon tax "could be extremely damaging to our economy and should be put on hold. A carbon tax as currently configured would add to costs, increase the cut-off grade and consequently sterilise mineral resources," the authors argue.

The report says groups granted prospecting rights should not be allowed to sit on them.

"We need to impose a use-it-or-lose-it regime by reinforcing the prospecting licence regulations to ensure licence holders undertake genuine exploration, with minimum work and minimum expenditure requirements, as is applied in many other countries," the report says.

3.2 Shabangu hammers final nail in coffin of nationalisation

Sharda Naidoo, Mail & Guardian, 7 February 2012

Minerals Resource Minister Susan Shabangu stood up at the Mining Indaba last year and declared: "there will be no nationalisation in my lifetime". On Tuesday morning she told a packed hall of global delegates with certainty that nationalisation is off the agenda for government and the ruling ANC.

Instead, she highlighted the new approach of resource nationalism -- a milder form of state intervention that will include a higher tax regime for the industry.

One of the proposals on the table is state control through rent share, and growth and development. Some of the interventions include a 50% tax on the sale of mining rights, a windfall tax of up to 50% on super-profits (defined as a return on investment of 22%), a reduction in royalty tax from 4% to 1%, a super ministry merging five ministries to police minerals governance and a rent share of mining rights.

Peter Leon, a mining expert at law firm Webber Wentzel, said it was good news that the government and the ruling party had decided to sing the same tune and end the debate of nationalisation but higher taxes were not reassuring for investors.

"Resource nationalism is still better than resource assets being nationalised but the proposed taxes are not a good idea if government wants to attract investment in the sector which is already battling to attract investment because of a restrictive regulatory regime," said Leon.

"Resources rent tax in Australia brought down the government and there the tax was a lot lower at 22% and only affected coal and iron ore. All these fiscal measures being proposed could create problems with investment."

On Monday, Minister in the Presidency Trevor Manuel acknowledged that the mining sector was in the doldrums and that investors needed more reassurance of policy certainty.

Speaking on the first day of the indaba, which organisers said attracted a record 7 500 delegates from around the world, Manuel said the mining sector's contribution to the economy shrank from R103-billion in 1993 to R92-billion in 2009. This was despite a synchronised commodities boom for most of that period, which South had missed.

"The challenge before us is to reverse this trend, and in reversing this trend we have to plan to boost investment and employment in mining by taking account of five critical issues," Manuel said.

These included policy and regulatory certainty, extraction of rents from the sector, investment in infrastructure, beneficiation and reducing mining's impact on the environment.

"This is what's going to drive the changes. We fervently believe that the country is capable of reaching much higher levels of output in mining."

Although he believed it was critical that sensible taxation exists to extract rent from the industry and invest in South Africa's development, he said South Africa would not hit mining companies with surprise new taxes -- it may adjust existing codes on the industry.

"If there is to be change, I'm pretty sure that the finance minister and department of mineral resources will take a long-term view and not impose this one fine morning," he added. "I don't think that surprises are good for an industry like this and this is likely to be the trend taken by government in introducing change."

He reiterated that "valuable taxation regimes can help achieve balance", especially when faced with volatile commodity prices.

4. Education crisis

4.1 Department is dysfunctional, says PEU

Chester Makana, Sowetan, 7 February 2012

The SA Democratic Teachers Union in Limpopo believes that problems facing temporary teachers could have been avoided had the provincial department of education fast-tracked the redeployment process.

About 500 temporary teachers are jobless after the department terminated their contracts this month. Also, 3500 teachers face an uncertain future as their contracts were only extended until the end of next month.

According to Sadtu, the department has failed to place the affected teachers in 2009/10.

Professional Educators Union's labour chairman Class Mohlatlole said teachers suffered an injustice because of the "department's dysfunctionality".

"Temporary teachers cannot be absorbed permanently because there are permanent teachers who are still without posts. The department has been dysfunctional for the past three years because it failed to address the problem," said Mohlatlole.

"There is no way the department can terminate teachers' contracts without completing the redeployment process."

Mohlatlole said no posts were created in the 2010/11 schooling year.

Education spokesman Pat Kgomo said they had renewed the contracts of teachers who could be placed. Temporary teachers are in the department's system to act for those who were on leave, according to Kgomo.

"We have extended the contracts until the end of March. We are hopeful that by then the redeployment process would have been finalised," said Kgomo.

Earlier, Basic Education Minister Angie Motshekga claimed that there were many ghost teachers in the Limpopo education system.

She claimed that her intervention team had uncovered more than 2000 ghost workers in the department.

Sadtu provincial chairman Ronny Morwatshehla insists that the department should deploy the teachers.

He said their members would continue to report at their respective workplaces.

4.2 I'm not for sale, says education boss

Zandile Mbabela, Sowetan, 6 February 2012

Embattled Eastern Cape education head Modidima Mannya has spat in the face of the SA Democratic Teachers' Union, saying he has no plans to step down and will not be bought off with a severance package.

The embattled education boss said Sadtu's attempts to oust him - including a suggestion to Premier Noxolo Kiviet to offer him a severance package to step down - would yield nothing.

He has refused to step down as head of the beleaguered department until he has served his contract.

"I'm not for sale and I have a contract with the department that I am determined to serve out," he said.

This comes at a time when the union is placing the blame for the chaos in the education department at Mannya's door.

Basic Education Minister Angie Motshekga also echoed the union's call to have Mannya removed - something the superintendent-general found to be somewhat undermining.

Among the current gripes between the union and Mannya is the issue of having thousands of temporary teachers axed and the ongoing redeployment drive that the union is protesting against through go-slows.

He said the union had been fighting redeployment for the past 10 years and thus created a need for temporary teachers "that the department simply can't afford".

The tripartite alliance - ANC, SACP and Cosatu - has also come to the province in a vain bid to find a political solution to the stalemate that has seen a disruption to teaching since schools reopened this year.

4.3 Mantashe's plea to parents

TimesLive, 7 February 2012

ANC secretary-general Gwede Mantashe has called on Eastern Cape parents to hold teachers accountable for the education of their children.

His call comes as the SA Democratic Teachers' Union continued with a go-slow campaign until the provincial education boss Modidima Mannya is removed.

Mantashe called on parents yesterday to get involved in their children's education.

"... But, at the end of the day, it will take the people of Eastern Cape appreciating that the education of their children is their responsibility. It is not just the responsibility of the SA Democratic Teachers' Union. The community in Eastern Cape must actually take it up that teachers teach their kids. If they don't, they must take action," Mantashe said.

He said parents should copy the actions of parents in Tembisa, in Gauteng, who demanded teachers do their jobs. He said parents told the teachers that, if they did not want to teach, they should "disappear".

"Since then Tembisa has actually become a serious point of teaching and learning and the matric results are reflecting that."

Speaking to the media, Mantashe defended the government against the perception that it was not doing enough to prevent the wild-cat teachers' strike in Eastern Cape.

The union embarked on a strike at the beginning of the year despite the fact that matric results in the province were among the worst in the country .

President Jacob Zuma placed the Eastern Cape education department under section 100 (b) administration last year, despite protest from some quarters in Eastern Cape. He transferred its administrative powers to the education minister.

Mantashe said: "There can be no more serious intervention than that. We have been their in our own capacity to talk to various people."

The education crisis in Eastern Cape is pushing the tripartite alliance into a conflict.

Cosatu and the SA Democratic Teachers' Union want Mannya removed.

But the ANC and the SA Communist Party warn that such a drastic move would set a "a suicidal precedent".

Mantashe and Cosatu general secretary Zwelinzima Vavi visited the province last month in an attempt to resolve the education crisi s.

However, their intervention has yet to bear fruit.

The education impasse in Eastern Cape is likely to continue as both Mannya and the teachers' union dig in their heels.

Mannya said at the weekend that he intends to serve out his employment contract and that he will not be "bought off with a severance package".

4.4 Take on teachers - ANC tells parents

Kingdom Mabuza, Sowetan, 7 February 2012

The ANC has urged parents to rise up and hold teachers accountable for the education of their children.

ANC secretary-general Gwede Mantashe yesterday told a media briefing that parents of learners in the Eastern Cape should take responsibility for their children's education.

The SA Democratic Teachers Union (Sadtu) in the province has been on strike since the beginning of the year, despite the matric results in the province being among the worst in the country.

Mantashe said: "The education department in the Eastern Cape has been placed under section 100 (b), which means it is under the control of the national Basic Education Department.

"Communities in the Eastern Cape must take it up that teachers teach their kids, if they (teachers) don't they must take action."

He said parents should copy parents of Thembisa in Ekurhuleni, who stood up and persuaded educators to take teaching seriously.

Mantashe defended government against the perception that it was not doing enough to prevent the wild-cat strike in the province. He dismissed suggestions that the ANC was treating Sadtu with kid gloves because it feared a backlash ahead of the ANC elective conference.

Mantashe also announced that nominations for leaders of the ANC would start in October, a month before the elective conference in Mangaung. The party will also hold its policy conference in June.

He said the party would not allow a culture where members raise their hands and declare themselves available for positions.

"There can't be a free-for-all ... and allow people to raise their hands. You get nominated, what happens when you raise your hand and nobody supports you?"

Mantashe said the ANC has decided to allow ANCYL president Julius Malema to present argument in mitigation to the national disciplinary committee before his suspension starts.

"The NDCA (national disciplinary committee of appeals) has confirmed the guilty verdict, if we were legalistic we could have said the 2010 two-year suspension will kick in. But we took a different view. We will wait for two weeks for mitigation and allow that process to the end."

4.5 ‘Underperforming teachers must leave’

Linda Ensor, Business Day, 7 February 2012

Teachers should be required to sign performance contracts and those who failed to achieve the objectives stipulated in these agreements should be "managed out of the system", Democratic Alliance (DA) parliamentary leader Lindiwe Mazibuko said yesterday.

However, she was not optimistic that the ruling African National Congress (ANC) possessed the political will to implement such a policy, saying it would not want to upset its political allies in the trade union movement.

SA’s education system has been criticised for failing to produce results, not least because many of its teachers lack the basic skills to perform their work.

But any suggestion of dismissing poor teachers has been resisted by trade unions, who argue that the focus should rather be put on upgrading skills.

Speaking at the Cape Town Press Club yesterday, Ms Mazibuko said "teachers who do not perform should be managed out of the system and replaced by competent ones".

She said she would argue in reply to President Jacob Zuma ’s state of the nation speech that schools that perform well should be given more power to manage their own affairs "because one size does not always fit all".

"I will make the case that in those schools we should make principals and teachers sign performance contracts, and institute minimum qualifications for principals," she said.

South African Democratic Teachers Union spokeswoman Nomusa Cembi said the union was not opposed in principle to the idea of performance contracts, but insisted that this should be discussed at the Education Labour Council as it would require a change in conditions of service for teachers.

Ms Mazibuko conceded that supply constraints would have to be addressed by opening up teacher training colleges. The government closed down the teacher training colleges so universities could take over this function.

Ms Mazibuko strongly criticised the government’s attempt to deal with the public health crisis by setting up a National Health Insurance scheme. She said this was based on the faulty premise that the government had to access private sector funds to build a quality health system.

The problem was not a lack of funding but a lack of political will, commitment and oversight on the part of government. Public hospitals were badly managed by incompetent CEOs, and doctors and nurses had to work in the most "appalling" conditions, Ms Mazibuko said.

All of this could be addressed without imposing a further financial burden on South Africans to fund National Health Insurance, Ms Mazibuko said. The private sector should not be regarded as a "money pot" for the government to fund a system that was dysfunctional already.

"We need to fix the system."

5. South Africa

5.1 Green energy ‘must also be owned by communities’

Siseko Njobeni, Business Day, 7 February 2012

Development finance institutions such as the Industrial Development Corporation (IDC) and asset manager Public Investment Corporation (PIC) could fund the "socially owned" renewable energy sector, as proposed by the National Union of Metalworkers of SA (Numsa).

The union has started a debate in which it points to what it says is the exclusion of communities as one of the shortcomings of the nascent renewable energy sector in SA.

Through the independent power producer (IPP) procurement programme, the government wants to build a renewable energy industry. The programme has attracted private sector investors into the local electricity generation market. In terms of the programme, a total of 3725MW would be generated from renewable energy sources by 2016.

But Numsa has warned against private sector domination of the sector. With the IPP procurement programme already under way, it is unclear to what extent Numsa’s calls would have a bearing on the renewable energy industry.

Speaking at the union’s conference on renewable energy in Johannesburg yesterday, Numsa deputy general secretary Karl Cloete said a "socially owned" renewable energy sector was characterised by a mix of "collective ownership". This includes energy parastatals, co-operatives and municipal-owned entities.

Finance options could include money meant for infrastructure development. "We must also consider funding from institutions such as the IDC and PIC," he said. The state-owned IDC is at the forefront of the government’s efforts to stimulate green industries, having set aside R25bn for their development and financing.

"Renewable energy has a great potential to give communities greater control of their resources and satisfying their energy needs on a decentralised basis, where fossil fuels are currently failing," Mr Cloete said. However, the private sector is better prepared than communities to carry out the expansion of the renewable energy sector.

"This includes the fact that they have better access to capital and technology, (research and development) and innovation ." Mr Cloete said the union’s structures would later adopt what will become Numsa’s position on the matter.

Commenting on the feasibility of the introduction of a socially owned renewable energy sector, ANC MP and chair of the party’s parliamentary group on energy, Sisa Njikelana, said it might be necessary to review and refine the procedures for renewable energy. He said "a just" transition from fossil-based energy to alternative energy was necessary.

Eskom senior GM Ayanda Nakedi said the utility was keen to play a role in the sector. Eskom’s Sere wind project in the Western Cape and concentrating solar power project in the Northern Cape would be completed next year and in 2016, respectively, she said. The two projects will produce 100MW each.

5.2 Parliament's 'bias' stirs storm over secrecy Bill hearings

Faranaaz Parker, Mail & Guardian, 7 February 2012

Questions have been raised about whether the Parliamentary Communication Services (PCS) has been able to remain impartial in its reporting of the public hearings on the contested Protection Of State Information Bill.

This comes after the PCS, which is supposed to be politically independent, sent out a press release that labelled one of the hearings in Barkley East, Eastern Cape, a "resounding success" and implied that this was because members of the public supported the Bill -- sometimes referred to as the "secrecy Bill".

The release, which appears to support the Bill, said that residents in the Joe Qadi district "flooded the venue" and showed a "keen interest in and understanding of the Bill", while an "overwhelming majority of the speakers welcomed the Bill" and that residents "unanimously" threw their weight behind it.

But Democratic Alliance MP Alf Lees says that these "residents" were actually ANC supporters who were bussed in to the hearings, which "effectively turned the event into an ANC rally".

"This was a clear attempt by the ANC to project the image at the hearing that the Bill is broadly accepted by the public," he said.

The press release made no mention of supporters being bussed in. It also differed sharply in tone from other releases put out by the PCS, which have been more measured.

Poor attendance
Lees, a member of the ad-hoc committee for the National Council of Provinces (NCOP), which is considering the Bill, said that attendance at the hearings had generally been poor and that many people have expressed dissenting views concerning the Bill.

The Bill seeks to regulate the way information critical to state security is handled.

Groups opposed to the Bill say its powers are too far-reaching. It would allow sentences of up to 25 years for people who reveal state secrets and provides little protection for whistleblowers
in the civil service and no protection whatsoever for investigative journalists, researchers, or ordinary members of the public.

It also contains a provision, which states that the Bill would trump the Promotion of Access to Information Act, which NGOs often use to get the state to release information that affects citizens' rights.

Despite the concerns raised by trade unions, political parties and NGOs, the Bill was approved by the ANC majority in Parliament and referred to the NCOP for further discussion. The NCOP is holding hearings on the Bill in each of the provinces. Hearings have already been held in the Western and Eastern Cape and will continue in the Free State this week.

Disregard for dissenting opinion
Commenting on the tone of the release, Media Monitoring Africa director William Bird said its most serious implication was that it could indicate a level of bias on the part of the committee and show disregard to citizens who had taken issue with the Bill.

"The emphasis of the process should be about how inclusive it is, how they are hearing the voices of South Africans and how they will help ensure a piece of legislation is not only understood but has also had the input of many more ordinary citizens."

However, he added: "Of course it might just be that a rather exuberant media person got carried away with the wrong message."

Murray Hunter, the national coordinator of the Right2Know campaign, which has campaigned for the Bill to be amended so that its powers are more narrowly defined, said its affiliate organisations reported that hearings in Thembalethu, Gugulethu and Nelson Mandela Bay had not been conducted in a way that gave people a proper chance to participate meaningfully.

"People coming to the meetings are not given a copy of the Bill, nor are they given a fact sheet. Many of the communities hosting public hearings, such as Thembalethu and Gugulethu, appeared not to have even heard about the events," said Hunter.

Lack of clear and neutral information
"We were seriously surprised to see Parliament's statement that so many people applauded the Bill and knew it inside out. Our enduring experience of the hearings has been that the public is frustrated with the short notice of the events, angry that there is a lack of clear and neutral information to guide the debate, and deeply concerned about certain provisions in the Bill," he added.

The PCS has admitted that there had been "difficulties" in rolling out information on the campaign in the Western and Eastern Cape but said steps are being taken to deal with these issues.

According to the PCS, a team from the Public Education Unit visits the designated areas in the days before a public hearing and distributes copies of the Bill and other information about the hearings to residents.

Its explanation for the contested press release is that it was in fact a comment piece that was accidentally published.

"PCS is committed to representing the institutional legislative process accurately. A comment piece on our website was inadvertently published without a qualifier and we apologise for this omission," it said.

The release has been removed from the website.

5.3 Sanral silent on e-toll terms

TimesLive, 6 February 2012

The SA National Roads Agency Limited (Sanral) remained silent on Monday on questions about the terms and conditions for motorists registering for e-tolling.

Last week, Consumer Commissioner Mamodupi Mohlala reportedly found the terms "excessively one-sided in favour of the supplier, and as such... not in line with the spirit of the Consumer Protection Act".

She said a clause in the conditions which allowed Sanral to get information from any institution concerning applicants where they had an account, was a gross violation of consumer's right to privacy.

"There should be some restriction to the kind of information that a service provider may have access to as long as it relates to the nature of the account or to the core business."

In January, Sanral announced that e-tolling, which was meant to begin this month, had been put on hold to address public concerns and petitions sent to the Minister of Transport, Sbusiso Ndebele.

Anti-toll petitions were submitted by the Democratic Alliance, the Congress of SA Trade Unions and the SA National Civics Organisation.

The announcement of the e-tolling system was met with wide criticism and outrage when it proposed that light motor vehicles with e-tag accounts would pay R0.49/km to use the toll roads, minibus taxi drivers R0.16/km and bikers R0.30/km. Vehicles without an e-tag account would be charged R0.66/km.

The Cabinet later approved reduced toll tariffs for the Gauteng highway tolling system.

E-toll account registration started in November with registered users depositing R50 into their accounts to create an initial balance.

Cosatu urged motorists not to buy- e-tags. It said if the tolls were not scrapped, Cosatu would encourage motorists to drive through the tolls without paying.

Meanwhile, a number of organisations were reportedly planning to take legal action against Sanral in an attempt to stop e-tolling on Gauteng's freeways.

The Road Freight Association said a group of industry players would take legal action against Sanral and that the legal documentation would be finalised in a few weeks.

6. Comment

6.1 Poverty is the enemy, not Malema

Luther Lebelo, ANC chairman, Liliesleaf Farm Branch (Midrand), Star, 7 February 7 2012

After reading newspaper articles about the end of Malema, followed by many other prophecies from our “super-thinkers”, newspaper editors and so-called political analysts, I found all of it sounding familiar.

Rummaging through my archives, I realised that the same headlines were written in 2005 against the backdrop of the dismissal of Jacob Zuma as deputy president of the country.

As the 2005 national general council was about to take place, it was speculated that Zuma would be suspended as the deputy president of the ANC, too, which would have ended his political career, sending him back to his rural Nkandla.

Of course the circumstances regarding Malema are different.

My suggestion is that we not turn ourselves into self-appointed, megalomaniac self-imposed prophets.

I have learnt lot of things from our super-thinkers, newspaper editors and the so-called political analysts that has made me view their prophecies with caution.

I have learnt that they make all these predictions to keep our eyes glued to their papers, which in turn gives them more sales and super profits, just as their masters expect from them.

As loyal ANC members, we have to respect the internal processes of the ANC, including the outcome and process of Malema’s hearing, while not forgetting that Malema is one of us and the ANC and its leadership love him and are doing all this for the greater good.

We must not fall into the trap, as the media once made us do during Zuma’s dismissal, of regarding Malema as public enemy number one.

Let’s rather see him as a brother, a young man who has perhaps faltered and maybe deserves punishment.

Perhaps a young man who, because of a lack of experience, may have genuinely believed not only in what he was doing, but also in how he was doing it.

We should remember that our real enemy is the system built over 350 years.

It still perpetuates race-based poverty, unemployment and under-development.

Our enemy is the inability of all South Africans to share openly with other South Africans who, either by default or design, are far less privileged than us.

It is the collective strength of the ANC, not the fall or rise of individuals, that will change people’s lives.

It is not incidents that hurt the ANC and the country but how we react and handle them.

That’s what makes a difference in terms of whether the ANC gets stronger or weaker, whether it gets to another 100 years or not.

As ANC senior leadership and members, we should be careful about the kind of message we send to Malema and those who believe in him.

It should be made clear that we are taking corrective action rather than a punitive act normally unleashed on our enemies.

6.2 Union bosses define capitalism: A flop?

Vivian Atud, Moneyweb, 6 February 2012

What do union bosses mean by capitalism?

Union bosses are preparing to get together at an “all-expenses paid by workers” conference in South Africa under the umbrella of the World Federation of Trade Unions (WFTU) from 8 to 12 February 2012. The theme for this gathering is “Capitalist Barbarism, Crisis and Imperialist Wars or Socialism”. What a shocking contradiction!

What do union bosses mean by capitalism? Are unions classless organisations? Can socialism provide a better life for workers whose interests are represented by union bosses? I will not attempt to answer all of the questions that can arise from the above theme but will try to illustrate a few scenarios that can logically and empirically explain some of the concepts.

Firstly, “capitalism”, “free enterprise”, “free markets” and “economic freedom” all mean the same thing: voluntary exchange between individuals free of third party intervention. This should be the same principle under which WFTU operates with its affiliated South African members: the National Union of Metalworkers of South Africa (NUMSA), the National Education, Health and Allied Workers Union (NEHAWU), the Police, Prisons and Civil Rights Union (POPCRU) and the Chemical Energy Paper Printing Wood and Allied Workers Union (CEPPWAWU) who, with WFTU, are all hosting the conference.

On looking at each of these unions’ websites there is a call for members of the public working in the given sectors to voluntarily join the respective union. In doing so, such a worker accepts to pay an annual membership fee and in return will receive all the benefits offered by the union. As it stands now, this is a voluntary transaction.

If the union bosses go ahead with recent proposals and convince union members to support a state controlled socialist system, this current voluntary exchange will be overthrown and replaced so that everyone working in any sector will be forced by the government to become a member of a trade union, even if they do not choose to do so. Alternatively, or additionally, unions will be banned or heavily controlled, as they have been in all socialist or communist countries.

The call by union bosses for the capitalist class society to be overthrown infers that the unions are classless organisations where everyone associated with them are equal and receive equal earnings. All other organisations, businesses and entrepreneurs for whom the majority of union members work for are portrayed as anathema.

A classless society has never existed and can never exist for logical reasons: every individual on this earth has different skills, potentials, abilities and interests, and every profession pays a different reward. For example, even if an economics professor would like to earn the rewards of a football star, the market does not allow for that to happen. Instead of calling for the overthrow of the capitalist class, the union bosses should be calling for the proper maximisation of the skills of their individual worker members and that they should be adequately rewarded according to their skills.

Socialism has already been tried and it has failed in many parts of the world. For union bosses to now propose socialism as a solution to the current world crisis is short-sighted and misleading.

Today, South Africa grapples with the plight of the unemployed. More than 6-million individuals of the economically active population are currently unable to find work. As the Union bosses meet under the watchful eyes of their political partner leader and President of South Africa, President Jacob Zuma, we will be curious to see whether the President will be critical of the solutions proposed by union bosses in the interests of the unemployed.

The theme of the conference would be more apt if it was turned around to read “Socialist Barbarism, Crisis and Imperialist Wars or Capitalism”. If this was so, union bosses could, instead of wasting their workers’ contributions and the country’s time and money calling for a failed system to be re-introduced, rather be showing government that, as already evident from their very own operating structures, voluntary trade and transactions are the most efficient method to use to allocate resources.

All proud South Africans would prefer to earn a dignified income from work rather than depend on a socialist state government grant. Jobs would quickly become available if union bosses pushed government to focus on unlocking the entrepreneurial potential of the unemployed even if it means decreasing statutory protection for the unions and reducing labour market regulation. They could go even further and demand that the government improve the economic climate of SA by taking proactive steps such as decreasing trade regulations.

If, instead of gathering at their members’ expense to beat a broken drum, union bosses displayed the courage, wisdom and foresight required to lead the workers, whether currently employed or unemployed, to a better and more rewarding future, calls to unleash this country’s entrepreneurial potential would go a long way towards increasing employment opportunities in the country and giving back to all South Africans dignity and hope for the future.

6.3 How state-owned companies can better serve SA’s needs

Malusi Gigaba, Business Day, 7 February 2012

Globally, there is a debate about how states can optimise the developmental role of state-owned enterprises (SOEs). One of the questions is: how does the government strengthen its shareholder management and what are the institutional models to provide this oversight?

The global financial crisis has legitimised state involvement in the economy and has shifted the focus to how this should happen. Part of this debate is how the state should leverage enterprise ownership in the developmental process.

SOEs have played a critical role in developing an industrial base in highly developed and emerging economies. Experience suggests that private and public companies have performed both well and badly in achieving key national developmental goals. There have been patriotic, efficient private companies that have made long-term investments to achieve national objectives. There have also been corrupt, inefficient and rent-seeking SOEs that have been captured to serve narrow interests and have undermined economic development.

Our challenge is to strengthen the state’s shareholder management capabilities to ensure that the contribution of our SOEs to national economic and social development is optimised, quantifiable and affects the lives of socially excluded South Africans.

When the African National Congress (ANC) assumed power in 1994, the Department of Public Enterprises was called the "Office for Privatisation", whose mandate was to sell its portfolio of SOEs. Intrinsic to this position was the notion that the state had no active role to play in the economy. SOEs were prevented from investing in new capacity as it was considered inappropriate in the context of imminent restructuring.

The notion was that the government should take a hands-off approach to economic governance and focus on regulating the functioning of the economy. As a result, some SOEs failed to achieve their objectives because of weak oversight and a deterioration of institutional capacity. It was only in 2004 that a firm decision was taken that the government would retain ownership of key SOEs. The shareholder manager department now had the role of providing SOEs with strategic economic mandates to align their strategies, business plans and processes with the government’s economic objectives.

SOEs were instructed to establish aggressive investment programmes to support the growing economy. These investments have proven critical in maintaining domestic demand and thus limiting the effect of the global crisis on SA. The department resolved that its new vision would be "to drive investment, productivity and transformation in our portfolio of SOEs, their customers and suppliers so as to unlock growth, drive industrialisation, create jobs and develop skills to sustain the economy".

To realise this vision :

n SOEs need to change their investment planning framework from one based on what their balance sheet can afford to one based on what investments are required to unlock growth in their customers and to create a stable demand platform for their suppliers;

n New sources of funding for the expanded investment plans need to be found, including from development finance institutions, pension funds and big SOE customers;

n SOEs need to procure in a way that promotes investment in local industry through providing medium-term demand information and entering into longer-term relationships with key suppliers; and

n Fortnightly meetings between the minister and SOE top management are held to monitor progress in the implementation of efficiency-enhancing initiatives and to entrench the principles of developmentalism.

SOEs are not ordinary commercial enterprises — they have a mandate to achieve longer-term strategic economic objectives (even if there are predictable short-term losses while capabilities are being built). This creates a delicate balance — if the strategic purpose subverts commercial discipline, the enterprise will collapse, but if commercial considerations over ride strategic purposes, government objectives will be compromised. Consequently, shareholder management of these multiple objectives is very complex.

Given this complexity, the department has learnt three key lessons about the shareholder manager function:

n The shareholder management role is highly specialised, requiring the ability to mediate between enterprise-level strategic, financial and risk concerns, sector policies, industrial policy and the broad national economic and social development imperatives;

n There is significant value that can be extracted from "portfolio synergies" between SOEs through shareholder co-ordination in areas such as planning, project implementation, procurement, skills development and knowledge sharing; and

n Significant value can be unlocked through high levels of co-ordination between SOEs, government departments and development finance institutions.

Driven by the specialised nature of the function and the need for co-ordination, there is a global trend towards the centralisation of state shareholder management of strategic enterprises. In certain cases, such as France and China, specialised government departments and shareholder management agencies have been established to oversee strategic enterprises. In other cases, such as Singapore, Malaysia and Kazakhstan, SOEs are held through a single state holding company. The result of centralisation is that the government will understand its asset base, achieve strategic alignment, use its asset base to leverage other investment opportunities, develop early warning systems and exchange market intelligence on businesses’ activities.

In this context, there are three broad approaches to housing the government’s shareholder management capability:

§ We can continue with the ad hoc approach to shareholder management pursued by different departments;

§ We can place the oversight of SOEs under their relevant policy department, which will inevitably create a conflict of interest between formulating policy and regulations to benefit the consumer and optimising the financial health of the enterprise; or

§ We can place a selected portfolio of key strategic SOEs under a dedicated shareholder management department to optimise their effect individually and as a portfolio.

However, I need to add some caveats. Leaving aside the merits of the third option, I do not believe we have the capability to include development finance institutions, as this requires highly specialised skills that are absent from the department. SOEs that serve a social rather than economic purpose — such as passenger rail agency Prasa, or the public broadcaster — and that do not sustain themselves off their balance sheets, should remain with their relevant departments.

The issue is not, either the state or the private sector — the building of our economy will require a coherent partnership between the two sectors. How the state can provide leadership to SOEs — to optimise a partnership that supports decentralisation of industrial activities to other provinces, to ensure increased access to income for poor communities — is of vital importance. This is no call for a Chinese or any other model, but a call for a Proudly South African model that takes into consideration our own experiences and developmental aspirations.

• Gigaba is Public Enterprises Minister and a member of the ANC’s national executive committee.

6.4 SABC will weather this storm

Dina Pule, Minister of Communications, Star, 7 February 2012

Any development that involves the SABC always attracts a significant amount of interest and public discussion. Each time there is news about the SABC, the millions of people who tune in to the broadcaster’s 19 radio stations or watch its three television channels or view its news web pages, make their views known.

This is a sign of a vibrant and democratic society that uses the SABC as a mirror to look at and reflect on itself. It is also very encouraging because it means that the people that the SABC broadcasts for and to are not prepared to be passengers as the public broadcaster pursues its mandate of educating, informing and entertaining the citizens.

This intense public vigilance puts a lot of pressure on the management team that runs the broadcaster, the board that has an oversight role, my team and I who formulate and implement policy and, of course, the workers who put together all the programmes that are loved by millions of South Africans.

Unfortunately, the SABC has been hamstrung by instability in recent years as scores of executive leaders in management have come and gone in a short time – many without leaving a tangible legacy.

Some had brief stints while others were in acting roles.

This cannot be allowed to continue much longer. Together with my team at the Department of Communications, I have committed to ensuring that the SABC is stable. My part of this commitment is to support the board as it seeks to build a strong management team by filling the vacant top positions with competent people.

Our commitment to move with speed to address the challenges at the SABC is underscored by the swift action I took to appoint Lulama Mokhobo as the group chief executive officer – within three months of coming into office.

The next challenge that relates to executive staffing at the SABC is filling, quickly, the remaining vacant top management positions. We would like to see this achieved by the end of this current financial year, next month. The SABC board has my absolute support in this pursuit.

Some of the key positions that need to be filled are those of the chief technology officer, chief financial officer and chief operating officer (COO).

It is possible to fill these positions by April 1, but not everything is in our hands.

For example, there is litigation around the COO position. We can’t advertise it until we have finalised the matter. If we start a search to fill this post we could be seen to be negotiating in bad faith.

As the shareholder, it is absolutely crucial for me to ensure that the processes followed to fill all the executive posts in all the state-owned entities that report to the department are transparent, fair and just. The SABC is no exception.

This will enable the SABC to focus on its core responsibility of providing quality news and programmes to the many South Africans who, each day, make the broadcaster their primary source of information, entertainment and reference point.

Also, leadership stability and certainty are crucial in the implementation of the SABC’s turnaround strategy.

We now have a fully constituted board after the appointment of Thami ka Plaatjie as the deputy chairman.

This board has clarity of purpose and is united and focused on making the best decisions for the benefit of the SABC.

At the operational level, I am encouraged by the work that is being done by many dedicated members of the SABC who are trying to make sure that the broadcaster turns the corner quickly and reclaims the integrity of its brands.

One way to reclaim the integrity of the brands is by producing and sourcing content that is right and developmental.

This type of content has to reflect our society and affirm our nationhood.

A very positive spin-off of this approach would be the many jobs that could be created by supporting local content producers.

The SABC will soon be undertaking a skills audit. This process is aimed at making sure that the skills that reside within the organisation are matched correctly to the responsibilities and requirements of the SABC. It will also help to identify skills gaps, if any.

I am very excited about what is happening at the SABC and I am certain it will soon be offering its listeners and viewers compelling programming.

Given the reports that I have seen, I’m confident that while the SABC has done all in its power to meet the conditions of the government guarantee, factors outside its control have compelled it to request a review of the original government guarantee targets.

In 2010/11, although it still made a loss, the quantum of that loss was smaller than what was projected in the government guarantee. Some revenue lines exceeded what was projected in the government guarantee, which is an indication of good performance. Based on this picture, we are confident that overall the SABC is on the right track to achieve its turnaround.

A strong and united board, working in harmony with a committed management team, will enable the SABC to sail into calmer waters. The SABC needs to be in calmer waters as it prepares for the broadcasting digital migration.

This is one of the biggest government undertakings, and we expect to be able to start migrating SABC broadcasts from around the third quarter of this year.

Broadcasting on a digital platform will improve the picture and sound quality of the SABC’s offering. It will also allow for more channels to be activated.

The SABC has survived many storms in the past. I’m confident that this current financial storm, which is being addressed in a satisfactory manner, will be overcome.

South Africans can look forward to soon receiving the broadcasts and services they deserve from the SABC.

6.5 Ehrenreich’s antics are a missed opportunity

Dave Marrs, Business Day, 7 February 2012

I can’t suppress my disappointment at the way the Congress of South African Trade Unions’s Western Cape secretary Tony Ehrenreich has approached his task as leader of the opposition in the Cape Town city council. He was the African National Congress’s (ANC’s) surprise nomination to stand against the Democratic Alliance’s (DA’s) Patricia de Lille, and given the state of the party in the province at the time — and the dearth of halfway decent alternatives — it seemed an inspired choice.

Ehrenreich has a solid history of involvement in the anti-apartheid struggle and as a community activist, in addition to his union work. He was therefore well placed to at least give De Lille a run for her money despite the momentum the DA had built up as a successful incumbent governing party in the city. But he seems to be at a loss as to how to make the transition from activist, working to bring down the system, to being part of a democratic order, whether in the government or on the opposition benches.

Just as there are people in the ANC’s national leadership who will always see themselves as revolutionaries no matter how entrenched the party becomes, Ehrenreich is skilled at finding ways to highlight problems, but can’t bring himself to form part of the solution. That’s sad from the perspective of anyone who cares more about outcomes than petty politics, but it’s also a little pathetic. The more successful the DA has been at running an efficient administration, the more outlandish Ehrenreich’s attempts to put a spoke in the wheel.

The following are a few examples of the "initiatives" he has taken over the past year — there were many more in a similar vein and most of them are still pending.

§ In July, he accused the city of "gross mismanagement" for failing to spend part of its capital budget and threatened to bring in the National Treasury to investigate;

§ In July he asked the public protector to investigate Western Cape education MEC Donald Grant’s appointment as a case of "corrupt cadre deployment" by the DA;

§ In August, he reported the city to the public protector for "corruption" over long-term cottage-lease agreements, although most have been in place for decades;

§ In November, he asked the public protector to investigate the city’s management of the Cape Town stadium on spurious grounds; and

§ In December, he took the city to the Equality Court for "refusing to promote a campaign to protect and promote local jobs".

It is possible that one or more of these will reveal a flawed process — some box that was improperly ticked. Hell, there could even be a real failure of governance or case of misappropriated funds in there somewhere. But the majority are clearly a waste of everybody’s time and will be thrown out or quietly dumped in file 13.

Worse, from Ehrenreich’s point of view, is that they make the ANC look lightweight and silly, which may be true in the province relative to its status in the rest of the country, but is surely not the image the party bosses in Johannesburg want to portray.

The Western Cape faces a host of fundamental challenges, most of which are either intractable, or the best solutions are debatable. The housing challenge, for instance, could benefit hugely from the constructive input of a party that still represents a large proportion of Xhosa-speaking residents.

But there is little sign of Ehrenreich helping to facilitate co-operation between the city and the Department of H uman S ettlements, for instance, or using the ANC’s influence in the townships to sort out housing waiting lists and reduce the conflict that arises from competition between the residents of informal settlements and "backyarders", for access to housing opportunities.

The irony is that Ehrenreich is missing opportunities to capitalise politically when the DA actually makes mistakes, such as De Lille’s over-the-top response to the recent "invasion" of Rondebosch Common and the province’s high-handed dismissal of objections to the Chapman’s Peak toll-plaza plans.

• Marrs is Cape editor.

Patrick Craven (National Spokesperson)

Congress of South African Trade Unions

1-5 Leyds Cnr Biccard Streets

Braamfontein

2017

P.O.Box 1019

Johannesburg

South Africa

Tel: +27 11 339-4911/24

Fax: +27 11 339-5080 / 6940

Mobile: +27 82 821 7456

E-Mail: pat...@cosatu.org.za

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